Whether
you are running a business, are an investor or an employee,
2014 will bring its opportunities and challenges. What
better time than now to take stock of your current
circumstances and consider your plans for the year or years
ahead. If you think you need help you probably do, so seek
advice and what better place to start than with your local
MSI firm.

1. Inflation or deflationWhere will
the Consumer Price Index go and what will the actions be by
the Reserve Banks in Australia and New Zealand and the
Federal Reserve in the United States? This will be an
indication of economic activity. Inflation will usually
occur as the economy picks up and if deflation occurs it
historically results in an economic downturn. Read the news
and be aware of the economy. It will impact on your
business, employment and investments.

2. Australian &
New Zealand dollarWill the ‘Aussie’ and the
‘Kiwi’ rise or fall and against which currencies?
Exporters want a falling home currency. Importers want a
strong home currency. A falling dollar usually results in
higher prices for goods and a rising dollar in lower prices.
Overseas travellers want their own currency to be strong.
Whatever your circumstances – be aware of the volatility
and that it can vary from currency to currency. Consider the
impact and develop a strategy.

3. Bank
financeIt is becoming harder to secure a bank loan
both in Australia and New Zealand. Banks have less to lend,
security percentages are dropping, bank valuations are
conservative, application forms are detailed and the events
that disqualify your application are rising. If you need to
borrow in 2014, commence the process early and consider
having a pre-approval review with your accountant.

4.
The rise of the InternetNothing new in this one but
the pace of change is likely to be faster in 2014. Consider
what impact this will have on your business and investments.
Look for opportunities and threats. Your opportunities could
be wrapped up within the threats.

5. The drive for
productivityThe mining boom in Australia has
subsided and other industries are being asked to take up the
slack. Governments are attempting to foster an environment
that results in productivity improvements and business will
be looking to join in. Review your processes to ensure that
you stay competitive. You may need to consider a long term
investment decision.

6. Employment LawOn the
Australian side of the Tasman, a change of Government has
introduced a change of emphasis. There is plenty of talk
about the benefits that SME’s will obtain from the
proposed changes. Watch for the rule changes in 2014 and
consider how to adapt them to your business.

7.
EmploymentUnemployment is rising in Australia and
this will impact on the strength of the economy particularly
in discretionary spending sectors. Business in those sectors
must look at their plans and those in employment need to
consider their security. On the flip side, New Zealand’s
unemployment rate is declining, and with this strength of
the labour market, the pressure will be on businesses in
finding the right staff.

8. Tax office audit
activityBoth ATO and NZ Inland Revenue systems and
information gathering systems are improving and the number
of audits is rising. Ensure your record keeping is robust
and recording of transactions is accurate.

9. Tax
Office Debt Recovery2013 was an election year in
Australia and historically the ATO has been lenient during
that time. The election is over and the Government needs
funds to reduce the national deficit. Expect tougher
collection action and for it to become difficult to obtain
an agreed plan to pay existing debts over an extended
period. Look at your cash flow and allow for the payment of
tax liabilities.

10. Economic
GrowthAustralia’s economic growth is tipped to
slow this year so businesses need to adjust and be prepared.
However it is forecasted that New Zealand is emerging to be
among the world’s fastest growing economies. With positive
migration into New Zealand, an upswing in terms of trade and
the strength of the labour market have all contributed to
increased business and consumer confidence. Businesses will
need to focus on being efficient and competitive.

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